Off-Highway Wheels Market

Market Overview

The global off-highway wheels market size was valued at USD 1556.2 million in 2023. It is expected to reach USD 2555.8 million by 2032, growing at a CAGR of 6.12% during the forecast period (2024–2032).

Off-road wheels are made of a rotating metal frame with a solid disc or spoke attached to the hub. The most typical applications for off-highway tires are vehicles used in off-road activities, such as mining, construction, and industrial settings. They are a common alternative to the typical on-road tires used on automobiles typically driven in topographically uneven areas and are gaining popularity. Off-highway vehicles may travel on and off paved or gravel terrain. They are sometimes referred to as off-road vehicles, overland vehicles, or adventure vehicles. It is often recognized by large tires with wide, deep treads, flexible suspension, or even caterpillar tracks. Tractors, forklifts, cranes, backhoes, bulldozers, golf carts, recreational off-highway vehicles, and off-highway electric vehicles are examples of off-highway vehicles utilized outside public roads or highways.

Highlights

• The steel wheels segment is the highest contributor to the market by product type.
• The agriculture segment is the highest contributor to the market by application type.
• Asia-Pacific is the most significant revenue contributor by region.

Market Dynamics

Global Off-Highway Wheels Market Drivers:

Rising Farm Mechanization Adoption in Emerging Markets

Particularly in high-income nations, mechanization in the agricultural sector was essential to transformation. Additionally, over the past few years, the adoption rate of mechanization in the farming sector has gradually risen in emerging markets (such as African nations, ASEAN nations, and other developing nations). Rapid urbanization, the expansion of medium-sized farms, rising rural wages, and seasonal labor shortages are key factors influencing the demand for mechanization. The agriculture sector needs agricultural mechanization because it increases crop output by improving the efficacy and efficiency of inputs used in crop production. The adoption of tractor rental in Ghana and other African nations, particularly those in the south of the Sahara, is being driven by the growth of mechanization and an increase in the number of medium-scale farmers. This should enable tractor owners to make the most of their vehicles while helping farmers who cannot afford their tractors. The demand for automated farming has increased as a result of factors like technological advancements and rising consumer demand, which is driving up tractor sales.

Global Off-Highway Wheels Market Restraints:

Fluctuating Raw Materials Prices

The cost of raw materials dramatically impacts the market for off-highway wheels. Due to rising input costs, particularly those of raw materials like steel and aluminum, the cost of production has skyrocketed for most manufacturers. Nearly 70% of all raw materials used in industries like the auto industry are made of metal. A hot-rolled coil's wholesale cost has increased by 40% since July 2020. Additionally, exporters must pay more in freight costs because the maritime supply chain is under pressure due to a rise in global demand and a lack of available containers.

The cost increases are also partially a result of lower capacity utilization, higher fixed costs, and overhead costs like those associated with covid safety protocols. Due to laws governing import and export, government regulations are essential to the market's development. In the past, trade disputes between China and the United States have also increased the price of raw materials. As a result, it is expected that any future changes to government policies and regulations will affect the market. Market participants' profit margins and revenues are negatively impacted by such raw material price volatility.

Global Off-Highway Wheels Market Opportunities:

Use of Solid Tires

While solid tires are frequently used on material handling equipment like forklifts, solid tires are also becoming more popular on compact construction equipment used in challenging environments or puncture-prone applications, such as waste, demolition, and paving. As solid tires become more widely used, future growth opportunities for wheel manufacturers are anticipated. Onboard equipment telematics can help with timely preventive maintenance to ensure minimal downtime by providing real-time performance information on critical systems, including tires, hydraulics, and engines. Even solid tires now have performance monitoring systems that allow users to access data on temperature, travel distance, etc. Another market with potential for expansion for wheel manufacturers is wheel-integrated sensor technology.

Regional Analysis

Asia-Pacific Dominates the Global Market

By region, the global off-highway wheels market is segmented into North America, Europe, Asia-Pacific, and the Rest of the World.

Asia-Pacific is the most significant revenue contributor and is expected to grow at a CAGR of 6.44% during the forecast period. China is the region's biggest market for machinery like cranes. Furthermore, it is also at the forefront of the crane electrification race. In addition, the government wants to aid in developing important projects, new infrastructure, and urbanization programs. To fund these projects, the Chinese government set aside USD 89.3 billion. Between 2022 and 2025, the construction industry is anticipated to grow by an average of 4.2% per year. The demand for construction vehicles and equipment is expected to rise due to these development factors, which could fuel the market for off-highway wheels. Civil construction is one of the key factors driving the Chinese construction industry's growth.

North America is expected to grow at a CAGR of 5.83% during the forecast period. A rise in agricultural activity, a resurgence of the construction industry, and other factors will lead to significant future growth in the off-highway wheels market. However, due to supply chain disruptions, labor and supply shortages, and other factors, the pandemic brought about an economic slowdown in the United States, which was reflected in the GDP with a 32.9% drop rate in the construction, agricultural, and other sectors. Despite pandemic challenges, the United States Off-highway wheels are again in demand; factors influencing this demand include a recovery in the construction, mining, and agricultural industries. According to the United States Construction Databook Series, the construction sector will experience rapid growth soon.

Germany is the second-largest consumer of agricultural machinery in Europe and one of the largest exporters worldwide. The second-largest and most innovative industry in Germany is agricultural machinery and equipment. More than 27% of the European agricultural machinery and equipment parts are produced in this nation. Due to continuous technological advancements, most of the nation's fields and farms are outfitted with self-driving, high-tech tractors, which many farmers regard as standard equipment. These factors will cause the demand for off-highway wheels to increase soon in Germany. Germany has the most significant construction sector in Europe, with a projected 6% GDP contribution in 2020. From EUR 37.18 billion in the first quarter of 2021, GDP From Construction increased to EUR 46.55 billion in the second quarter. In addition, the construction sector emerged from the pandemic stage, with revenue rising 5.9% to EUR 143 billion in 2020. Over the past few years, residential construction has experienced significant growth.

Countries like Brazil, Argentina, Peru, Chile, and Colombia are in South America. The agriculture sector is one of Brazil's main industries and a significant contributor to its economy. As a result of increased investments, the nation's supply of agricultural equipment and tools has increased. Due to the recovery in several industries, the expansion of credit, the government's clear strategy with its extensive support for privatization, which may encourage investments from prominent international players and state-owned enterprises, and the allocation of funds for infrastructure development of roads, ports, and airports, the construction industry is anticipated to experience stable growth during the forecast period. As demand for this equipment rises, the country's market for construction vehicles is expanding quickly. During the forecast period, there will likely be a rise in demand for off-highway wheels due to the expansion of the construction and agricultural industries.

Segmental Analysis

The global off-highway wheels market is segmented by product type and application type.

Based on product type, the global off-highway wheels market is bifurcated into alloy wheels and steel wheels.

The steel wheels segment is the highest contributor to the market and is expected to grow at a CAGR of 6.12% during the forecast period. Steel wheels are much more durable than alloy wheels and more suitable for off-road vehicles because they can withstand much greater forces without cracking or bending than alloy wheels. Some well-known market participants are utilizing cutting-edge manufacturing technology to create lightweight, high-strength steel wheels, which presents a business opportunity for investors. Strong aftermarket presence and global initiatives to increase the steel market's contribution to the development of efficient vehicles are likely to attract the attention of market participants.

Aluminum, nickel, magnesium, or a combination of these metals are used to make alloys, which are used to make alloy wheels. Since they are frequently several kilograms lighter per wheel or less weight, they perform better than steel wheels. These alloys also offer better braking performance and lower the possibility of brake failure because they can dissipate heat better than steel wheels. Although aluminum has been used in automobiles for a while, its percentage is expected to rise with the growing electrification of off-highway vehicles, especially for lightweight applications. This, in turn, is expected to increase demand for alloy wheels in electric off-highway vehicles due to their benefits. However, due to aluminum wheels' lower strength when compared to steel wheels, the market segment is anticipated to grow moderately during the forecast period.

Based on the application, the global off-highway wheels market is bifurcated into agriculture, construction, material handling, and mining.

The agriculture segment owns the highest market and is expected to grow at a CAGR of 6.2% during the forecast period. Over the past few years, the agriculture sector has seen notable growth worldwide. Additionally, several studies from the past few years have revealed that more than 60% of poor working adults are supported by agriculture. Such factors are causing the agriculture industry to expand, which has led to the growth of agricultural machineries like tractors and harvesters, among other things. As a result of the continued use of these vehicles, there will be a high demand for wheels, which will lead to an increase in the off-highway wheels market globally.

The demand for material-handling vehicles like forklifts and stackers will rise as warehouse, port, and manufacturing activities increase. This is because these machines save time and money by reducing the need for human labor. The demand for such machine wheels in the OEM and aftermarket industries will increase as their use spreads worldwide. Another factor driving the material handling market is the acceleration of technological development, as the development of artificial intelligence and the internet of things is dramatically altering the workforce across various industries. Automated and self-operating material handling equipment is altering the roles of human employees. Additionally, smart material handling is a more intelligent approach, further streamlining the entire system's operation. As a result of the E.U.'s stage V emissions regulations, which will ban diesel vehicles in the U.K., France, and some other regions starting in 2030, the demand for electric material handling vehicles, such as electric forklifts, is expected to increase in the future in many different countries.

Recent Developments

• October 2022- Engineering firm OTR announced a Program for port wheel inspections with Taylor Machine Works.
• September 2022- The largest wheel manufacturer in the world, Maxion Wheels, revealed that its newest plant for truck steel wheels, with Inci Holding as a partner, is prepared to open in Turkey. Additionally, a facility will be built by the two businesses to start selling forged aluminum Commercial Vehicle (CV) wheels in 2024.